Lorraine Williamson
Spanish police have dismantled a cryptocurrency fraud operation that swindled over 30 million euros from more than 3,600 victims. The scheme, operating across Málaga, Murcia, and Madrid, is one of the largest crypto pyramid scams ever uncovered in Spain. Over 2,700 victims were based in Spain, with others spread across 36 countries.
Following nearly three years of investigation, officers from the Fraud Department of the Central Unit of Economic and Financial Crimes (UDEV) arrested eight individuals. The mastermind, a programmer, was detained in Málaga. His team, consisting of individuals with expertise in marketing and web design, helped create a seemingly legitimate investment platform.
How the fraud operated
The suspects lured victims into investing large sums, converting funds into Bitcoin. In some cases, they accessed victims’ devices directly to complete transactions, stealing personal and financial data in the process. Authorities estimate losses at around 400 bitcoins, currently valued at approximately 37.2 million euros.
False promises and hidden costs
The investigation began in 2022 when a victim in Murcia filed a complaint. The fraudsters promised returns of 40% per month and up to 300% per year. However, the system functioned as a classic pyramid scheme, with initial profits paid using investments from new participants. When victims attempted to withdraw funds, they faced additional costs and withdrawal restrictions, leading to financial losses.
Raids and seizures
During the operation, police seized 73 bank accounts, 12 cars, and five motorcycles. The fraudsters even created a worthless virtual currency to deceive investors further. Many victims lacked prior experience with cryptocurrency, making them particularly vulnerable.
Authorities continue investigating to determine the full extent of the fraud and identify additional suspects.
Preying on the vulnerable
Scammers often build trust within communities before exploiting their victims. In a similar case, a fraudster infiltrated a local football club in Málaga, joining alongside his family to integrate with other members. He attended social events and barbecues and built friendships before approaching players individually with an investment opportunity. He promised a guaranteed monthly dividend, which he could initially pay using funds from new investors.
Our editor’s husband was among those approached, but he invested only a small amount. Others, however, lost thousands. It later emerged that the scammer, along with his wife and eldest son, had carried out similar frauds elsewhere and were allegedly wanted in Argentina.
The key lesson is clear: if an investment offers a guaranteed high return with little or no risk, it is likely too good to be true.